I am writing in response to Montana's request to amend its State accountability plan under Title I of the Elementary and Secondary Education Act (ESEA), as amended by the No Child Left Behind Act of 2001 (NCLB). Following our discussions with your staff, those changes that are aligned with NCLB are now included in an amended State accountability plan that Montana submitted to the Department in December 2004. A list of the changes is attached to this letter. We will post Montana's amended plan on the Department's website. Additionally, based on information you have provided us, regarding the actions taken by the Montana Office of Public Instruction to finalize certain elements in the accountability plan required under NCLB, Montana has met the conditions of approval, as were detailed in Eugene W. Hickok's June 27, 2003 letter to Montana.

I am approving your amendment regarding Montana's minimum group size for reading/language arts and mathematics proficiency calculations and the related tiered adequate yearly progress (AYP) review process for small schools for the 2003-2004 AYP determination cycle only. For 2004-2005 school year AYP determinations and prior to the start of the 2005-2006 school year, Montana must submit an amendment to its accountability plan, subject to the Department's review and consideration, for its minimum group size for reading/language arts and mathematics proficiency calculations along with accompanying impact data from the 2003-2004 AYP determinations regarding the use of the minimum group size and tiered AYP review process for small schools.

As proposed in its tiered AYP review process for the 2003-2004 AYP determinations, Montana will calculate AYP for all schools and subgroups regardless of group size. For schools with a group size of 30 or more and subgroups with a size of 40 or more, Montana will base AYP solely on these calculations. However, for schools and subgroups that fall below this minimum group size, Montana will additionally use a confirmatory small school/small subgroup review process that will examine prior years' assessment data from the former State assessment. Given the extremely small and rural schools in Montana and the fact that Montana administered new standards-based assessments in 2003-2004 and only tested in three grades in 2003-2004, we believe this approach is warranted for the 2003-2004 school year to improve the validity and reliability of AYP determinations this year. As we have discussed with your staff, we will continue to work with Montana this year to find an acceptable approach for making AYP determinations for the 2004-2005 school year and beyond.

If, over time, Montana makes changes to the accountability plan that has been approved, Montana must submit information about those changes to the Department for review and approval, as required by section 1111(f)(2) of Title I. Approval of Montana's accountability plan is not also an approval of Montana's standards and assessment system. As Montana makes changes in its standards and assessments to meet requirements under NCLB, Montana must submit information about those changes to the Department for peer review through the standards and assessment process.

Please also be aware that approval of Montana's accountability plan for Title I, including the amendments approved above, does not indicate that the plan complies with Federal civil rights requirements, including Title VI of the Civil Rights Act of 1964, Title IX of the Education Amendments of 1972, Section 504 of the Rehabilitation Act of 1973, Title II of the Americans with Disabilities Act, and requirements under the Individuals with Disabilities Education Act.

I hope that you have found the accountability plan amendment process effective for implementing a State accountability system that best serves the needs of Montana's students and schools and that will lead to improving the academic achievement of all students. As evidenced by the diversity among State accountability plans and State consolidated applications, States have great flexibility in the design of their systems and implementation of particular NCLB provisions. If, as you implement your accountability plan, you find additional elements of your plan that you believe should be refined or amended for next school year to best serve the needs of your students and schools, I encourage you to explore all the areas of flexibility available to your State.

In addition to the flexibility available to States in the design and implementation of their accountability plans, I also encourage you and your districts to utilize the additional flexibility available for the administration and operation of NCLB programs. NCLB continued the flexibility available to States and districts under the 1994 reauthorization of the ESEA, including the ability to consolidate State and local administrative funds (sections 9201 and 9203), to operate schoolwide programs (section 1114), and to participate in the Education Flexibility Partnership Program ("Ed-Flex"). Additionally, NCLB created several new flexibility options for States and districts for the operation of federal programs. These new flexibility provisions include the State Flexibility Authority (sections 6141 through 6144), the Local Flexibility Demonstration program (sections 6151 through 6156), Transferability (sections 6121 through 6123), and the Rural Education Achievement program (sections 6201 through 6234). These flexibilities truly offer States and districts the ability to target federal resources to their unique and individual needs.

I am confident that Montana will continue to advance its efforts to hold schools and school districts accountable for the achievement of all students. I wish you well in your school improvement efforts. If I can be of any additional assistance to Montana in its efforts to implement other aspects of NCLB, please do not hesitate to call.

Revision: Montana has updated its plan to include the State's starting points in reading/language arts and mathematics based on new assessments administered during the 2003-2004 school year.

Minimum Group Size and AYP for Small Schools and Subgroups (Elements 5.5, 9.1 )

Revision: For the 2003-2004 AYP determinations only, Montana will calculate AYP for all schools and subgroups regardless of group size. For schools with a group size of 30 or more and subgroups with a size of 40 or more, Montana will base AYP solely on these calculations. However, for schools and subgroups that fall below this minimum group size, Montana will additionally use a confirmatory small school/small subgroup review process that will examine prior years' assessment data from the former State assessment.

Confidence Intervals (Elements 5.5, 9.1)

Revision: Montana will apply a 95% confidence interval to AYP decisions for reading/language arts and mathematics proficiency. Beginning with assessment data from the 2004-2005 school year test administration, Montana will apply a 75% confidence interval to safe harbor calculations for reading/language arts and mathematics proficiency.

Students with Disabilities (Element 5.3)

Revision: Montana will be using the final regulation in the Federal Register issued December 9, 2003, concerning the 1.0% cap for students with the most significant cognitive disabilities.

Limited English Proficient Students (Element 5.4)

Revision: Montana will include the flexibility that the Secretary's letter of February 20, 2004 provides relative to LEP students for assessment and accountability purposes.

Participation rate (Element 10.1)

Revision: Montana will adopt the new flexibility regarding multi-year averaging of participation rate. Montana will also adopt the new flexibility regarding students who have significant medical emergencies during the testing window and its affect on a school's participation rate.